13.01.20
Network Rail 'taking action' on SMEs
Source RTM: Dec 2019 /Jan 2020
Commercial director Ken Blackley explains how Network Rail’s new action plan for working with small and medium sized enterprises will mean better engagement, listening and solutions.
Small and medium sized enterprises (SMEs) are the lifeblood of Britain’s economy. There are 5.7 million SMEs in the UK, employing 16 million people, and their adaptability and innovative ideas are invaluable to the dynamic challenges of the railway.
At Network Rail we are aiming for a third of our annual expenditure to be spent with SMEs by 2022. Our current level of annual expenditure with SMEs is 30 per cent, up by five per cent in three years. In 2018/19 we contracted directly with just over 4,000 suppliers and 71 per cent of these were SMEs.
We must make the most of the expertise and creativity SMEs offer, as our supply chain is critical to help us deliver rail services across Britain, but after speaking with many of our smaller suppliers earlier this year it became clear that we needed a plan for better engagement and working relationships. That is why we launched our SME action plan in November, which is available to view on our website.
The action plan addresses engagement as well as pre-procurement, procurement, contract management, supplier management and innovation. To make it easier to do business with us, we are simplifying our processes and providing clarity on what we want from suppliers, including publishing a briefing document explaining our procurement policy, processes and procedures. We are also intent on publishing clearer sourcing pipelines. Our new champion for SMEs within Network Rail provides a central point of contact and we are in the process of appointing regional SME champions.
To encourage innovation, we are exploring the idea of SMEs pitching their ideas to a small Network Rail panel that could grant funding to develop or pilot ideas with a positive business case. The panel would be able to grant funding of up to £30,000 to develop or pilot ideas with a good business case potential. We are also addressing the fact that Network Rail charges for standards outside of a tender period; instead, we will make access to standards free for our supply chain. Where possible we will move away from zero-value frameworks, which is where we have entered into contracts without a minimum committed value to the supplier.
The SME action plan will make us more accountable to our suppliers too. It is based on feedback from workshops where suppliers shared their concerns and hopes, as well as working group discussions with the Rail Industry Association (RIA), Railway Industry Contractors Association (RICA), Civil Engineering Contractors Association (CECA), Rail Safety & Standards Board (RSSB) and both the Department for Transport and the Department for Business, Energy & Industrial Strategy. Those working groups will continue, and over the next two years we are also committed to holding a number of ‘Meet the Buyers’ events and SME focus groups to increase face-to-face engagement with suppliers.
Alongside the action plan, Network Rail is changing as part of its Putting Passengers First programme, with a simplified commercial and procurement structure in place since November: five regional commercial and procurement teams supported by a central team in Route Services. This means there is greater alignment over commercial categories, a consistent approach and empowerment of the regional teams, which will lead to better visibility of our workbank.
Together, the steps set out in the plan will add up to big improvements and noticeable changes.
Read more
Photo: Network Rail